Tankers go dark for longer to get oil out of Middle East

Some clandestine journeys last a week or more

Strait of Hormuz Ship-tracking data shows Romania Prosperity idling in waters off Fujairah and Sohar in recent days, but a lengthy period when it had its transponder turned off makes it hard to know what it actually did. (Bloomberg)

Key Takeaways:Toggle View of Key Takeaways

  • Supertankers increasingly switched off transponders for days or weeks while crossing the Strait of Hormuz and Bab el-Mandeb, making cargo movements difficult to track.
  • The practice expanded as Iran-related security risks persisted and Houthi threats grew, with Signal Ocean reporting 62% of tankers crossed Hormuz dark after July 14.
  • Tanker owners continue using concealment tactics and shuttle transfers because freight rates remain highly profitable, suggesting the market has adapted to the security environment.

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Supertankers are going dark for longer to get oil through the Strait of Hormuz and the Bab el-Mandeb strait, doubling down on tactics honed in the earlier days of the Iran war. 

Vessels carrying non-Iranian crude started turning off their transponders to avoid detection in the weeks following the start of the conflict in late February. At that time they would typically go dark for just a few hours while transiting Hormuz.

Now, some of these clandestine journeys can last a week or more, with tankers sometimes reappearing thousands of kilometers away. That’s making it tough for ship trackers to figure out what happened during the time, a problem that’s compounded by the popularity of the so-called shuttle trade, where oil is transferred onto other vessels just outside Hormuz.

A recent example of this trend was the supertanker Romania Prosperity: It vanished in waters off Fujairah on the Gulf of Oman in late July, and then reappeared nearby 10 days later, with observers unable to ascertain if it was carrying the same cargo of crude or had transferred it to another vessel and then gone back into the Persian Gulf to pick up a fresh shipment.



Ship-tracking data shows Romania Prosperity idling in waters off Fujairah and Sohar in recent days, but a lengthy period when it had its transponder turned off makes it hard to know what it actually did.

Another very large crude carrier, the Alexandros, disappeared while empty in the northern Red Sea in the middle of last month before emerging partially laden near India last week. Meanwhile, supertanker Kuwait Prosperity vanished in the Persian Gulf loaded with crude in early July, before turning up 10 days later near Indonesia. 

Vessels turn off their transponders primarily to mask their locations and avoid attacks by Iran, with shipowners ready to run the risk of taking cargoes through dangerous chokepoints due to how profitable it is. In recent weeks, the United Arab Emirates state oil company has even started to move Iraqi oil through Hormuz.

The dark passages, alongside other upheavals in the freight market, “suggest that the VLCC market has adapted to a different operating environment,” said Maria Bertzeletou, a senior market analyst at Signal Ocean. “Confirmed tanker transits have shifted toward concealment.”

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The tactic of tankers pushing turning off their transponders has ebbed and flowed as U.S.-Iran tensions oscillated. An interim peace agreement that started in June resulted in more ships broadcasting their transits, but after Tehran began striking vessels again dark journeys increased. More recently, the practice has spread after the Iranian-backed Houthi militant group announced a blockade of Saudi Arabian oil in the Red Sea in mid July.

Some 62% of oil and product tankers crossed Hormuz dark between July 14, when the U.S. reinstated its maritime blockade of Iran, and early August, according to Signal Ocean. That compares with around half before that. The Signal Ocean data doesn’t show how long ships are turning off their transponders for.

 

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